UBS client gets probation, fine for tax evasion

SEATTLE (Reuters) - A retired Boeing Co sales manager was sentenced on Friday to one year probation and a $10,000 fine after he admitted to hiding $1.86 million in UBS AG accounts in Switzerland.

Roberto Cittadini, 68, is at least the fifth UBS client in the last year and the second this week to be sentenced as the U.S. government tries to advance a major tax fraud probe.

The Bellevue, Washington resident pleaded guilty in October to one count of filing a false tax return, and admitted to failing to report income from his accounts, according to the Justice Department.

According to court documents, Cittadini set up a Hong Kong corporation in 2000 at the suggestion of Swiss banker Hansruedi Schumaker and also received counsel from Swiss lawyer Matthias Rickenbach. Both were indicted as part of the probe in August.

At a hearing on Friday, Cittadini told U.S. District Judge Ricardo Martinez that while “tax evasion was never a consideration” in his thinking, he made a “grievous mistake of judgment” in opening the accounts.

“I stand before with you strong feelings of guilt, shame and humiliation,” Cittadini said, as his voice broke. “It has made me a felon for the rest of my life.”

Prosecutors had sought a five-month prison term. But the judge, while saying the lesser sentence could be viewed as “little more than a slap on the wrist,” cited Cittadini’s cooperation in the case, as well as the defendant’s having repaid much of what authorities said he owed.

The defendant had faced a maximum sentence of three years in prison and a $250,000 fine.

Last February, UBS admitted to criminal wrongdoing for helping U.S. taxpayers hide accounts from the Internal Revenue Service, and accepted a $780 million penalty.

Six months later, it agreed to turn over names of 4,450 wealthy American clients to U.S. tax investigators.

Rickenbach also worked with Juergen Homann, a UBS client in New Jersey, who was sentenced on Wednesday to five years probation and a $60,000 fine for failing to report $6.1 million he held in Swiss bank accounts.

At least six UBS clients have pleaded guilty to tax charges in connection with the probe.

Five have been sentenced to prison or probation. A sixth, John McCarthy of Malibu, California, is scheduled to be sentenced on January 28, court records show.

The case is U.S. v. Cittadini, U.S. District Court, Western District of Washington, No. 09-0344.

Reporting by Laura Myers; Writing and additional reporting by Jonathan Stempel in New York; Editing by Richard Chang